Explore topic-wise InterviewSolutions in Current Affairs.

Air transport is the fastest transportation mode.

The first cotton textile industry had established in Mumbai because:

• Mumbai is a port 
• It is
  near by cotton producing area
• Mumbai was a financial centre

The largest producer of Bauxite is Orissa.

Pipeline mode of transport is used to supply cooking gas in different areas of the world.

Malaysia is the largest exporter of rubber.

The Founder of Human Geography in France was Demangeon.

Rice is the main crop of subsidence farming.

Ruhar coal field is situated in Germany.

Vice-President dignitaries cannot be impeached.

correct option is a) President and Governor 

(c) Attorney General of India

Correct option is (b) Both A and R are true but R is not the correct explanation of A

The correct answer is Bolivia.

• The Cochabamba Water War was a succession of protests that took place in Cochabamba, Bolivia's fourth-largest city.
• This protest lasted approximately for four months between December 1999 and April 2000 in reaction to the privatization of the city's municipal water supply company SEMAPA.

• On 10 April 2000, the national government come to a contract with the Coordinadora to repudiate the privatization of water supply in Bolivia.
• Bolivia is a country in central South America, its administrative capital is La Paz and constitutional capital at Sucre.
• Boliviano is the official currency of Bolivia.

Correct option is (d) Interpretation of the policies framed by the top management.

b) Search and Rescue Team

Search and Rescue Team search and provide for rescue of victims, as is prudent under the conditions and assist the Fire Suppression Team.

a) Realistic.

A goal should be Realistic, which means manageable and achievable.

(d) The total number of Stock Exchange in India is 23. However, as per the latest updates by SEBI, there are 25 Stock Exchanges in India.

Departmentalisation

Departmentalization (or departmentalisation) refers to the process of grouping activities into departments. Division of labour creates specialists who need coordination. This coordination is facilitated by grouping specialists together in departments.

(b) Primary and secondary markets complement each other. Primary market deals with the issue of new securities. That is, through the primary market a company raises capital directly from the borrowers. On the other hand, secondary market deals in the purchase and sale of the existing securities. That is, once the securities are issued in primary market, they are then traded in the secondary market. It is in this sense that both the markets complement each other.

Answer: Increased creativity and innovation

Trading on equity refers to a practice of raising the proportion of debt in the capital structure such that the earnings per share increases. A company resorts to Trading on Equity when the rate of return on investment is greater than the rate of interest on the borrowed fund. That is, the company resorts to Trading on Equity in situation of favourable financial leverage. As the difference between the return on investment and the rate of interest on debt increases, the earnings per share increase.

The use of Trading on Equity is explained in detail with the help of the following example.

Suppose there are two situations for a company. In situation I it raises a fund of Rs 5,00,000 through equity capital and in situation II, it raises the same amount through two sources- Rs 2,00,000 through equity capital and the remaining Rs3,00,000 through borrowings.

Also suppose the tax rate is 30% and the interest on borrowings is 10%. The earnings per share (EPS) in the two situations is calculated as follows.

Clearly, in the second situation the EPS is greater than in the first situation. In the second situation the company takes advantage of the Trading on Equity and raises the EPS. Here, the return on investment calculated as [{Earning Before Tax (EBT)}/Total Investment]=100000/500000 is 20% while the interest on the borrowings is 10%. Thus, the Trading on Equity is profitable.

However, it should be noted that Trading on Equity is profitable and should be used only when the return on investment is greater than the interest on borrowed funds. In case the return on investment is less than the rate of interest to be paid, the Trading on Equity should be avoided.

Suppose instead of Rs 1,00,000 the company earns just Rs 25,000. In such a case the EPS are calculated as follows.

Clearly in this case, the EPS in Situation II falls. Here the return on investment is only 8%  [{Earning Before Tax (EBT)}/Total Investment] = 40000/500000 while the interest on the borrowings is 10%.

Thus, in this situation the Trading on Equity is not favourable and should be discouraged. Hence, it can be said that a firm can use Trading on Equity if it is earning high profits and can increase the EPS by raising more funds through borrowings.

Dividend decision of a company deals with what portion of the profits is to be distributed as dividends between the shareholders and what portion is to be kept as retained earnings. The following are the factors that affect the dividend decision.

(i) Amount of Earning: A firm pays dividend out of its current and the past earnings. This implies that earnings play a key role in the dividend decision. A company having higher earnings will be in a position to pay a higher amount of dividend to its shareholders. In contrast to this, a company having low or limited earnings would distribute low dividends.

(ii) Stable Earnings: When a company has a stable and a smooth earning, they are in a position to distribute higher dividend as compared to the companies who have an unstable earning. In other words, a company having consistent and stable earnings can distribute higher amount of dividends.

(iii) Stable Dividends: Companies generally follow the practice of stabilising their dividends. They try to avoid frequent fluctuations in dividend per share and opt for increasing (or decreasing) the value only when there is a consistent rise (or fall) in the earnings of the company.

(iv) Growth Prospects: Companies aiming for a higher growth level or expansion of operations retain a higher portion of the earnings with itself for re-investment. Thus, dividend of such a company is smaller as compared to the companies with lower growth opportunities.

(v) Cash Flow Position: Dividend payments require cash outflow. If a company is low on cash then the dividend will be lower as compared to the company which has more liquidity. Even if a company has higher profits, it will not be able to distribute high dividends if it does not have enough cash.

(vi) Preference of the Shareholders: A company must keep in mind the preferences of the shareholders while distributing the dividends. For instance, if the shareholders prefer at least a certain amount of dividend, then the company is likely to declare the same.

(vii) Taxation Policy: Taxation policy plays an important role in deciding the dividends. If the taxation policy is such that a high rate of tax is levied on dividend distribution, then the companies are likely to distribute lower dividends. On the other, it might prefer to distribute higher dividends if the tax rate is low.

(viii) Stock Market Reactions: The amount of dividend that a company distributes affects its stock market prices. An increase in dividend by a company is viewed as a good sign by the investors and the stock price of the company goes up. On the other hand, a fall in the dividends adversely affects the stock prices. Thus, while taking the dividend decision, a company must consider the probable stock market reactions.

(ix) Contractual Constraints: Sometimes, while giving out loans to a company, the lender may impose some restrictions in the form of agreement. These restrictions may be related to the dividend paid in the future. In such cases, the company has to keep such agreements in mind when distributing the dividends.

(x) Access to Capital Market: The companies that have a greater access to the capital market tend to pay higher dividends. This is because they can rely less on retained earnings and more on other sources due to the market access. The smaller companies who have lower access to capital markets tend to pay lower dividends.

(xi) Legal Constraints: Companies have to adhere to the rules and policies laid out by the Companies Act. Thus, any company needs to take care of such restrictions and policies before declaring the dividends.

Yes, capital budgeting decision is a very essential decision which needs to be taken carefully. It has the capability of changing the financial fortunes of a business. Capital budgeting decision refers to the decisions regarding the allocation of fixed capital to different projects. Such decisions involve investment decisions regarding attainment of new assets, expansion, modernisation and replacement. Such long term investments include purchasing plant and machinery, furniture, land, building, etc. and also expenditure as on launch of a new product, modernisation and advertising, etc. They have long term implications on the business and are irrevocable except at a huge cost. They affect a business’ long term growth, profitability and risk.

The following are the factors that highlight the importance of capital budgeting decisions:

(i) Long Term Implications: Investment on capital assets (long term assets) yield return in the future. Thereby, they affect the future prospects of a company. A company’s long term growth prospects depend on the capital budgeting decisions taken by it.

(ii) Huge Amount of Funds: Investing in fixed capital involves a large amount of funds. This makes the capital budgeting decisions all the more important as huge amount of funds remain blocked for a longer period of time. These decisions once made are difficult to change. Thus, capital budgeting decisions need to be taken carefully after a detailed study of the total requirement of funds and the sources from which they are to be raised.

(iii) High Risk: Fixed assets involve huge amount of money and thereby, involve huge risk as well. Such decisions are risky as they have an impact on the long term existence of the company. For example, decision about the purchase of new machinery involves a risk in terms of whether the return from the machinery would be greater than the cost incurred on it.

(iv) Irreversible Decisions: These decisions once made are irrevocable. Reversing a capital budgeting decision involves huge cost. This is because once huge investment is made on a project, withdrawing it would mean huge losses.

Capital Structure refers to the combination of different financial sources used by a company for raising funds. The sources of raising funds can be classified on the basis of ownership into two categories as borrowed funds and owners’ fund. Borrowed funds are in the form of loans, debentures, borrowings from banks, public deposits, etc. On the other hand, owners’ funds are in the form of reserves, preference share capital, equity share capital, retained earnings, etc. Thus, capital structure refers to the combination of borrowed funds and owners’ fund. For simplicity, all borrowed funds are referred as debt and all owners’ funds are referred as equity. Thus, capital structure refers to the combination of debt and equity to be used by the company. The capital structure used by the company depends on the risks and returns of the various alternative sources.

Both debt and equity involve their respective risk and profitability considerations. While on one hand, debt is a cheaper source of finance but involves greater risk, on the other hand, although equity is comparatively expensive, they are relatively safe.

The cost of debt is less because it involves low risk for lenders as they earn an assured amount of return. Thereby, they require a low rate of return which lowers the costs to the firm. In addition to this, the interest on debt is deductible from the taxable income (i.e. interest that is to be paid to the debt security holders is deducted from the total income before paying the tax). Thus, higher return can be achieved through debt at a lower cost. In contrast, raising funds through equity is expensive as it involves certain floatation cost as well. Also, the dividends are paid to the shareholders out of after tax profits.

Though debt is cheaper, higher debt raises the financial risk. This is due to the fact that debt involves obligatory payments to the lenders. Any default in payment of the interest can lead to the liquidation of the firm. As against this, there is no such compulsion in case of dividend payment to shareholders. Thus, high debt is related to high risk.

Another factor that affects the choice of capital structure is the return offered by various sources. The return offered by each source determines the value of earning per share. A high use of debt increases the earning per share of a company (this situation is called Trading on Equity). This is because as debt increases the difference between Return on Investment and the cost of debt increases and so does the EPS. Thus, there is a high return on debt. However, even though higher debt leads to higher returns but it also increases the risk to the company.

Therefore, the decision regarding the capital structure should be taken very carefully, taking into consideration the return and risk involved.

Answer: Switzerland

Direct democracy is likewise called a 'pure vote based system'. It is a type of popular government wherein individuals choose (for example vote on, structure agreement on) approach activities straightforwardly. It is particular from delegate majority rule government in which individuals vote in favor of agents who at that point institute strategy activities.

The purpose of terrorism is to exploit the media in order to achieve maximum attainable publicity as an amplifying force multiplier in order to influence the targeted audience(s) in order to reach short- and midterm political goals and/or desired long-term end states.

Ambrose # 606,

II main

Ghat Road

Gayathrinagar

Bengaluru

Sub – Inspector

Gayathrinagar Police Station

Bengaluru

Dear sir, I am compelled to write to you on behalf of all residents of Gayathrinagar. We have been facing untold difficulties due to the increasing incidents of chain – snatching in our locality. Women and children are afraid to venture out – doors after dark due to the threat of chain – snatching. Old people are deprived of their evening walk, women have to stay indoors and miss visiting neighbours and friends due to this threat.

The other day, a miscreant on a bike daringly snatched a women’s chain while she was standing outside her house waiting for her children to return from tutuions. A fortnight ago another bike – borne miscreant snatched the ear – ring a little girl playing in front of her house in the evening, tearing the poor girls’ ear – lobes into pieces, which required surgery to sew them back.

hope you will increase necessary steps to ensure that this threat doesn’t escalate into life – threatening incidents. I suggest that you increase police patrol after dark. I hope that you will put an end to this chain – snatching menance at the earliest.

                                                                                                                       Yours sincerely,

                                                                                                                          Ambrose.

                                                                                                                                        Sunil

                                                                                                          Government High School

                                                                                                                                  Peenya

                                                                                                                                 Bangalore

Dear Papa,

How are you? I hope you are keeping well. I miss you, ever since you were transferred to Mysore. I feel unhappy without you being here with us. But somehow I console myself and involve myself in studies.

Papa, today is the last day of our final exams, without you here in Bangalore, I will feel bored during the summer vacation. I request you to please allow me to go to grand – pa’s house to spend my vacation. As you know grand – pa has fractured his leg last week and grand- ma is finding it difficult to look after him, I might be of some help to them. I will take care of them while I stay there and grand – ma will also feel relieved. I hope you will agree to send me to grand – pa’s house. Please write back to me as soon as you are free.

                                                                                                                     Your loving son 

                                                                                                                          Sunil

27.03.2019

C. Mohanan 

C/5, Mambalam 

Chennai

The Manager 

Globe Travel Agency 

The Mall, Shimla

Dear Sir, 

Sub: Hotel accommodation and other facilities

I am planning to visit Shimla during the summer vacation. I intend to reach there on 16 May ‘ by the IC 308 flight and stay there for a week. You are requested to book a deluxe double bedroom in a five-star hotel, as I will be accompanied by my friend. I shall also need a chauffeur-driven car to take us in and around Shimla.

Please make these facilities available for a week, i.e., from 16 May to 22 May, 2019. A bank draft for ‘ 5000 is enclosed as advance. Please confirm the bookings so that the remaining amount may be sent to you.

Thanking you

Yours faithfully 

C. Mohanan

To 

The Manager Globe 

Travel Agency 

The Mall, Shimla

25 July 20XX

 Vasanthi 

No. 2/8, Ayanavaram

The Editor 

The Times of India 

Chennai

Sir, 

Sub: Frequent Digging up of Roads

I would like to highlight the problems faced by the residents of Ayanavaram due to the frequent digging up of roads by various departments, such as electricity, water supply, sewage, telephones, etc. We have to put up with traffic diversions almost every fortnight. The dug roads remain unrepaired and cause traffic hazards as well as accidents.

We have written to the Development Authority many times, but our repeated efforts have failed to bear any fruit. I hope the publication of the letter in your newspaper will draw the attention of the authorities to our plight and motivate them to expedite the repair work.

Yours faithfully 

Vasanthi

To 

The Editor 

The Times of India, 

Chennai

15th Sept, 

2018 

From 

XXXX 

YYYY

To 

Box No.3224 

C/o. The Hindu 

Madurai – 625 002

Respected Sir/Madam, 

Sub: Application for the post of salesman – Regarding

This is in response to your advertisement write to referred above for the post of salesman. I apply for the post of salesman in your esteemed firm. I have the required qualification. My particulars are furnished for your perusal and favourable consideration.

Yours sincerely, 

xxxx

Resume Name: XXXX 

Date of Birth: 18th July, 1990 

Marital Status: Single 

Father’s Name: Karuppiah 

Address For Communication: YYYY 

Contact number – mobile: 9998778588, residence: 22349577 

Mother Tongue: Tamil 

Language Known: English and Tamil

Educational Background

Technical knowledge: 

1. English typewriting higher 

2. Computer MS office 

Experience: Worked as Sales man in Laxmi Textiles, Kovai for 5 years.

Hobbies : Dramatics, Reading, Music. 

Expected Salary : 35,000/ per month 

Salary Drawn : 28,000/ per month 

Joining Time : Can join in a week notice 

Language Known : English, Hindi and Tamil

I assure you that if I am selected discharge my duties to the best of my abilities and to the utmost satisfaction of my superiors.

Photo stat copies of my credentials have been enclosed for your kind perusal.

Expected Salary Salary Drawn Joining Time 

Language Known 

Enel: Copies of testimonials

Declaration 

I hereby declare that the above given information is true to the best of my knowledge.

Yours faithfully 

XXXX 

Signature of the Applicant

Station : YYYY 

Date : 15.09.2018

To 

The Managing Director, Lakshmi Textiles, 

174, Broadway, 

Chennai – 105

25 March, 2019 

A. Shanti 

23-L, New Friends Colony 

Pattabiram Chennai 

The Chief Engineer 

Electricity Board 

Chennai

Sir, 

Sub: Frequent power cuts and low voltage It is quite surprising that the residents of such a posh colony such as Friends Colony are made to bear a lot of inconvenience and trouble due to frequent break downs of electricity and voltage fluctuations. Delhi doesn’t remain a pleasant place to live in the scorching summer weeks. The temperature shoots even upto 45°C and more. The erratic supply of electric power only compounds the sufferings of the people. The low voltage makes it difficult for the air conditioners and fans to operate at their required capacity. Great voltage fluctuations have resulted in damaging domestic electrical appliances.

Students of the area are the worst sufferers. The examinations are round the comer. They can’t study properly at night even during their examinations. Friends Colony Residents Welfare Association has been taking the issue regularly with the concerned authorities. Nothing fruitful has come out so far. I request on behalf of residents and students in particular to ensure the regular and trouble-free supply of power in the Colony.

Yours truly 

A. Shanti

To 

The Chief Engineer 

Electricity Board 

Chennai

From 

XXXX 

YYYY

To 210,

Gandhi Road 

Coimbatore – 02.

Respected Sir/Madam, 

Sub: Application for the post of office assistant

With reference to your advertisement in The Hindu, dated 8th March, 20XX seeking applications for the post of office assistant, I offer my candidature for the same. Please find enclosed my bio-data / resume to enable you to assess my suitability for the aforesaid post.

Yours sincerely, 

XXXX

Resume 

Name : XXXX 

Date of Birth: 18th May, 1994 

Marital Status: Single 

Father’s Name: Mr. Rajesh

Address For Communication: YYYY 

Contact number – 

mobile: 9998777688 

residence: 22345577 

Mother Tongue: Tamil Language 

Known: English and Tamil

Educational Background

Technical knowledge: 

1. English typewriting higher 

2. Computer MS office Hobbies : Dramatics, Reading, Debating. 

Expected Salary : 25,000/ per 

month Salary Drawn : 18,000/per month

Declaration 

I hereby declare that the above given information is true to the best of my knowledge.

Station : YYYY 

Date : 10.03.2019

Yours faithfully 

XXXX 

Signature of the Applicant

To 

210, Gandhi Road 

Coimbatore – 02.

Self Inductance:

The phenomena in which an emf is induced in a coil due to change of current through the same coil is known as self Induction.

Mutual Inductance:

The phenomena in which an emf is induced in one coil due to change of current is the neighbouring coil is called mutual induction

29.08.2019 

12-L, Saidapet 

Chennai

The Editor 

The Adayar

Times Chennai

Dear Sir, 

Sub: Health hazards caused by junk food Through the column of your esteemed daily, I want to highlight the health hazards being caused by eating the so called ‘fast or junk food’.

The globalization is not confined to the economy only. Even our food habits have been globalised. The craze for fast foods like burgers, pizzas and pasta has increased in recent years. The youth have developed special liking for them. McDonalds, KFCs, Pizza Huts are leading multinationals who promote junk foods.

The junk food, no doubt, tingles our tastebuds. But it has little or no nutritional value. The general public, particularly, the youth must know the health hazards caused by the regular . eating of junk food. It causes obesity. Habitual eaters suffer from many other diseases of liver, digestion and kidneys. Let us remember that fresh food cooked in our kitchen with a liberal use of vegetables and fruits is really tasty as well as nutritious. The junk food is good only for ‘junkies’.

Thanking you 

Yours faithfully

N. Mani

To 

The Editor 

The Adayar 

Times Chennai

(1) 3RT

U = \(\frac{nfRT}{2}\)

f = 6 (for triatomic) 

⇒  U = 3RT